Raising the Roof

Colorado Governmental Immunity Cap Increase Imminent

This year could bring the first increase in the tort cap in 4 years. It’s time to make sure your limits are high enough.

Four years ago, Governor John Hickenlooper signed Senate Bill 13-023, amending the Colorado Governmental Immunity Act (CGIA) to raise the cap on damages recoverable against public entities from $150,000 to $350,000 per claimant, and from $600,000 to $990,000 per occurrence to all claimants.

This came at the heels of the Lower North Fork wildfire, an event in which a local government was found negligent. Since it came into effect on July 1, 2013, citizens can bring a wide range of claims against public entities that override governmental immunity, like negligent operations of public facilities, unsafe conditions of parks and roads, or failure to perform a background check as required of education employment.

So, how is this relevant to us now?

What you may not know is that Subsection (c) of Section 1 of the bill also states the following:

“The amounts specified in subsections (a) and (b) of this subsection (1) shall be adjusted by an amount reflecting the percentage change over a four-year period in the United States index for Denver-Boulder-Greeley, all items, all urban consumers, or its successor index. On or before January 1, 2018, and by January 1 of every fourth year thereafter, the Secretary of State shall calculate the immediately preceding four-year period as of the date of the calculation. The adjusted amount shall be rounded upward to the nearest one thousand dollar amount increment.”

The bill refers to the United States index, or more specifically the Consumer Price Index (CPI), which is set by the United States Department of Labor’s Bureau of Labor Statistics. The CPI represents the prices of goods such as food staples (milk, wheat, coffee, wine, chicken, etc.), transportation, recreation (televisions, pets, admissions to events, etc.), health service charges, fuel, rent or housing costs of a primary residence, bedroom furniture, clothing (even including jewelry) and other essential items. These prices rise with inflation and market fluctuations, allowing this benchmark to more accurately reflect the actual cost of goods and services in one geographic area to another. For example, the aforementioned things don’t cost the same thing in Denver as they would in Grand Junction, nor would they in San Francisco or Kansas City.

Many public entities refer to the CPI for their individual budgetary projections because it ties so closely to info@csdpool.org.

Note that when the firm numbers on the new CGIA limit are finalized, we will provide an update.